The woman was sat on a bench opposite the Blues Bar in Montpellier Hill when a man touched her and then exposed himself.
Detectives today said they believed that a number of people were in the area at the time of the assault, which took place on between 9pm and 10pm on Saturday August 13.
Some of them had been concerned about the woman.
A man in his 50s has been arrested in connection with the incident and he remains in police custody.
Anyone with any information is asked to call North Yorkshire Police on 101 and ask for Harrogate Serious Crime Team, quoting reference number 12160149144.
Information can also be passed to Crimestoppers on 0800 555 111.